The Lovesac Company (LOVE) Q1 2027 earnings summary

Executive summary

• Net sales for Q1 FY27 were $138.2 million, nearly flat year-over-year, outperforming a furniture category that declined 2.2% and high-end furniture down 5%, with disciplined execution amid industry headwinds and modest market share gains.

• Larger configurations and premium add-ons drove mid double-digit growth in transactions over $6,000, while transactions below $6,000 remained soft.

• Strategic focus remains on new product launches, domestic production, expanding product platforms, enhancing customer acquisition, and building long-term customer relationships.

• E-commerce sales rose 7.1% year-over-year, increasing digital penetration by 170 basis points.

• Six new showrooms opened and three closed, with a net increase of 14 showrooms year-over-year.

Financial highlights

• Showroom net sales increased 0.6% to $97.1 million, internet sales grew 7.1% to $35.7 million, while other sales dropped 36.3% to $5.5 million due to the end of the Best Buy partnership.

• Sactional net sales decreased 1.4%, Sacs fell 22.5%, while other products (including Snug/Snugg) surged 228.1%.

• Gross margin declined 160 bps to 52.1%, mainly from higher transportation and tariff costs, partially offset by price increases and cost reductions.

• SG&A was 49.6% of net sales, up from 48.5% last year, due to higher payroll and overhead.

• Operating loss was $17.4 million; net loss was $11.1 million ($0.76/share), compared to $10.8 million ($0.73/share) last year.

• Adjusted EBITDA loss was $10.5 million, versus $8.4 million last year.

• Cash and cash equivalents increased to $57 million; no debt; $34.9 million in committed credit availability.

Outlook and guidance

• FY27 net sales expected at $700–$740 million; adjusted EBITDA $35–$46 million.

• Full-year gross margin forecast at 56–57%; SG&A at 40–41% of net sales.

• Net income projected at $5–$12 million; diluted EPS $0.34–$0.81.

• Q2 net sales guidance: $157–$166 million; adjusted EBITDA between -$4 million and $2 million.

• Guidance includes $3.6 million in tariff refunds already received or to be recognized in Q2; no future refunds assumed.